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Google used a Dutch shell company to shift $23 billion (£18 billion) across to Bermuda in 2017, saving them a substantial amount of tax on its international revenue.

The US tech giant used the same loophole in 2016 to shift its finances around – but this year it increased the overseas amount by four billion euros.

The transfer, which is technically legal, was shown in documents filed at the Dutch chamber of commerce.

Bermuda has a 0.00% corporate tax rate which gives Google’s parent company Alphabet a handy way of reducing its outgoings.

The brand logo of Alphabet Inc’s Google is seen outside its office in Beijing, China (Image: Reuters)

The process is known as a ‘Double Irish Dutch Sandwich’ structure. It means the company shifts its revenue from an Irish company to a Dutch one that has no employees. In turn, the money is then sheltered away to a Bermuda mailbox owned by another Irish company.

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Google Netherlands Holdings has no employees and is a subsidiary of Google Ireland Holdings. The latter is incorporated in Ireland but is managed and controlled from Bermuda, according to documentation from the United Nations Economic and Social Council.

Front Street in Hamilton, the capital of Bermuda (Image: Getty)

Ireland reformed its law to stop this happening in 2015, but companies that set up with this structure before then can continue to operate like this until 2020.

As for Google, it continues to insist that it pays all the tax it is legally obliged to pay in all the countries in which it operates.

‘We pay all of the taxes due and comply with the tax laws in every country we operate in around the world,’ the tech giant said in a statement.

Google says it pays all the tax it’s legally obliged to (Image: Getty)

‘Google, like other multinational companies, pays the vast majority of its corporate income tax in its home country, and we have paid a global effective tax rate of 26% over the last 10 years.’